US cement shortage - Bush to invade China?

12 May 2004

A cement shortage that has hammered much of the Southern US States could be migrating north and driving up the price of concrete. The shortage has been acute this spring in Florida and Texas, where it has brought some construction projects to a grinding halt. In Wisconsin, building contractors say they haven’t run short of cement, but prices have gone up several times since February and are expected to rise again soon for a total of about 12 per cent so far this year.

China is blamed for much of the current imbalance in world trade, sucking up lots of essential imports of steel, cement and basic commodities, pushing up prices and with higher import shipping demand levels also driving up ocean freighting costs.

"A lot of imported cement that was taken for granted in the past is no longer available," said David Lumsden, president of St. Marys Cement Inc., Even if you could find the foreign-made material, it’s too expensive anyway because of market demands and a shortage of ships to haul it, Lumsden said to Rick Barrett from the Sentinel Journal.

"The flare in demand arrived on the heels of an unusually active winter for construction, which is traditionally a down period for plants," said Ryan Pucket, a PCA spokesman. "There was no letup in demand, so there’s very little cement in reserve this spring."

Concrete prices went up $3 per cubic yard in February and are expected to increase another $4 this month, said John Poblocki, president of Poblocki Paving Corp. in West Allis. Combined, the price hikes represent about a 12 per cent increase in the cost of concrete.

There very likely will be cement shortages in the Midwest this summer, said Todd Schaller, general manager of Central Ready Mixed Concrete in Milwaukee. Spot shortages could stem from the demands on cement supplies from major concrete projects, such as improvements to Milwaukee’s deep tunnel sewer system, Schaller said.

Steel shortages, and the high price of steel, have added to the woes of cement users. That’s because the steel reinforcing rods and wire mesh used in building everything from skyscrapers to cement culverts are in short supply. "Every contractor is feeling it," said David Turner, president and owner of Turner Concrete Construction.

The short-term solution to the shortage is to import more cement when it’s available, Puckett said. Longer term, cement companies have announced plans to expand manufacturing capacity totaling more than 15Mt between now and 2010.